According to the Salesforce Education Cloud Consultant documents, the EDA Setting for Simple Address Change Treated as Update allows the system to update existing address records when a user makes a minor change to an address, such as correcting a typo or adding an apartment number. This prevents the creation of duplicate address records and ensures data quality. If this setting is disabled, the system will create a new address record whenever an address is changed, even if the change is minor. Reference:
EDA Documentation: Address Management
Trailhead: Education Data Architecture Basics